Economics & Investing For Preppers

Here are the latest news items and commentary on current economics news, market trends, stocks, investing opportunities, and the precious metals markets. We also cover hedges, derivatives, and obscura. And it bears mention that most of these items are from the “tangibles heavy” contrarian perspective of SurvivalBlog’s Founder and Senior Editor, JWR. Today, we look at investing in silver. (See the Precious Metals section.)

Precious Metals (Silver):

The recent breakout in the spot price of silver to above $16.28 per Troy ounce probably has some short-selling traders quaking in their boots. The price ratio of silver-to-gold is now running around 88-to-1, which although down from the recent absurd 92-to-1 high still screams opportunity for silver investors. I suspect that the price of silver will escape the market manipulators and the silver-to-gold ratio will revert to around 75-to-1, or possibly even lower. (75-to-1 would mean a spot price for $18.88 for silver, assuming that gold holds at around $1,415 per ounce.) And in the long run, with more silver than gold being consistently “used up” in unrecovorable industrial processes, I expect the silver to gold ratio to be down around 25-to-1, by the end of the 21st Century. Watch the metals markets closely, folks. I’ll admit that I’ve always had a predilection for silver, but the fundamentals here would convince just about anyone that the Silver Bull may soon have his day!

Economy & Finance:

The “Scared & Desperate” Fed Is Playing The Most Dangerous Game. Here is a key quote:

“On Wednesday odds for a 50bp rate cut had dropped to 34%, by the time Clarida, Bullard, and Williams were done these odds had skyrocketed to 71%.

Come on. None of this is an accident.

JP Morgan now expects 12 central banks to cut rates in the next 2 months. The global easing cycle has begun. With negative rates still in place.

What’s all this really tell us? A recession is coming, they know it and they are desperate to prevent it. It also says zero rates are coming back and I suspect, in due time, negative rates. Which means markets will eventually drop despite the current efforts to jam things higher.

But a Fed desperate to jawbone markets higher, to “influence markets” is playing the most dangerous game.

A Fed admitting they have limited ammunition and are openly abandoning their data dependency mantra to stop the business cycle is an open admission of weakness. And a weak Fed may commit the worst sin a Fed can commit: Lose confidence of the market. And once that happens all things are possible…”

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The Victims of Inflation

Commodities:

The Only OPEC Member That Could Challenge Saudi Oil Dominance

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Millions of acres of Midwest farmland eligible for U.S.-backed insurance. JWR’s Comment:  The harvest numbers for 2019 are bound to be very low. This will drive higher grain prices. Count on it!

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EV Giants Vie For Battery Dominance

Taxes and Control:

Beware, the IRS is eyeing your inherited money

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State Tax Changes as of July 1, 2019. One notable item in this article was about California’s spiraling fuel taxes:  “As the second part of a gas tax increase approved by legislators in 2017, California’s gas tax rose 5.6 cents per gallon on July 1, bringing total state taxes and fees on gasoline to 57.8 cents per gallon and surpassing Pennsylvania for the highest state taxes and fees on gasoline.”

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Swedes are getting implants in their hands to replace cash, credit cards

Tangibles Investing:

I believe that we are now witnessing the lowest point in the “Trump Slump” dip in AR-15/M4 rifle prices. Presently, over at Palmetto State Armory (one of our affiliate advertisers), you can but a complete M4 lower with a Blackhawk 6-position stock for $99.99 postage paid, and a complete upper with 16″ barrel for 179.99 postage paid. So… For under $280, you are getting a complete 5.56mm semi-auto rifle (minus a magazine.) $280 in 2019 (inflated) Dollars is an absurdly low price for an M4. For a point of comparison: A Ruger Mini-14 Tactical Rifle presently has a suggested retail price of $1,169.

Consider this: If any Democrat wins the 2020 presidential election, then I expect the price of ARs to jump up to somewhere north of $1,100 for basic/generic models, and much more for the best quality variants. There are very few investments with the chance to more than double in 18 months. So if you have any room in your gun vault, then stack them deep!

o  o  o

Makers & Shakers: George Gruhn on the State of the Vintage Guitar Market. Here is a quote:

“What’s the main difference between the vintage and new guitar markets? There are many differences. For one thing, there are a lot more recent-issue and utility-used guitars out there than vintage guitars. It took Martin from 1833 to 1947 to make 100,000 guitars, and they hit serial number 100,000 in 1947 and 1,000,000 in 2004. Now they’re now well past 2,000,000, which means the majority of Martin guitars ever made have been made since 2004. Taylor’s also way up. Gibson and Fender are way up. Fender didn’t get started until 1946, but Fender makes a lot more guitars per year than Martin, and it didn’t take long for Fender to make more guitars than Martin had made in their entire history.

The number of vintage guitars, however, is tiny. The number of vintage Martins is way, way smaller, because the ones that most of the collectors are really looking for were made from about 1928 through the early ’40s.”

Provisos:

SurvivalBlog and its Editors are not paid investment counselors or advisers. Please see our Provisos page for our detailed disclaimers.

News Tips:

Please send your economics and investing news tips to JWR. (Either via e-mail of via our Contact form.) These are often especially relevant, because they come from folks who closely watch specific markets. If you spot any news that would be of interest to SurvivalBlog readers, then please send it in. News from local news outlets that is missed by the news wire services is especially appreciated. And it need not be just about commodities and precious metals. Thanks!




11 Comments

  1. You may want to add a few sets of guitar strings for future trade or just to maintain the ability to make music. They are expendables and may never be made again after the a collapse. This goes for all musical instruments that utilize strings, reeds, rosin etc. I cannot imagine a world where there is only percussion and primitive wind instruments, that would surely be a sign of a regressive society.

    1. “I cannot imagine a world…”

      That’s exactly why we’ll be moving our piano to the homestead. When I find hymnals for $1.00, we snatch them up.

      Also, when our giant, old live oaks succumbed to Oak Wilt, we used the trunks to make a large campfire ring. Girl Scout and Boy Scout song books have many fun songs that can be taught to all ages.

      It’s obvious many Preppers have some solar, so I would suggest maintaining a music library of a variety of CD’s to be played periodically, everything from rock and roll oldies, the warhorses of old classical music, to Americana.

      Music, real music, feeds the soul. Over the years , dozens and dozens of people have told me, “they don’t sing.” Gaining pleasure from music can raise morale and provide comfort.

    2. Not a half bad idea. One thing I’ve done is to save old CD’s and a boom box along with old phones and Ipods to use as music players. My daughter plays guitar so I’ll be following your suggestion and buying a few sets of spare strings.

  2. you keep posting the kit prices from Palmetto but I don’t find them. Please post the link
    for the exact item you are talking about. I did not find any 99 dollar complete lowers
    Thanks

    1. Unfortunately, that sale just ended. Sorry! But they often have similar sales on complete AR uppers and lowers.

      For instance, they just started a special on AR pistol uppers and lowers.

    2. I recently purchased 10 AR-15 lowers for $129 each… then a few months later purchased the uppers for about $180 each from PSA… $309 for an AR-15 is not bad… neither is $3090 for ten.

      Keep your powder dry…

  3. I am Doubling Down on my prepping. The yield curve is still inverted, signalling a recession. The Federal government is still spending like crazy, and no one in the government is arguing for fiscal restraint. Why? Because they all worry that a recession is coming, and spending makes the Gross Domestic Product number higher. Not really higher, but the ‘official’ number is higher. GDP for 2018 was a fantastic 5%, but Federal debt went up 6%. That means real growth was not 5%, but MINUS 1%. Oops. Wonder why that was not in the news.
    There is MORE flooding in the Midwest. Some crops will be affected, raising food prices. Stock up now.

  4. Update- The President and congress announced a budget deal today which ends the possibility of a government shutdown this fall, and continues spending until July 2021, after the Presidential elections. The agreement raises spending caps by $320 Billion and suspends the debt ceiling. Most programs will get 4% increases. It also allows the President to shift funds around, causing Sen. Leahy of VT to announce he would oppose it because the President could use funds to build a border wall. Leahy later announced that he would vote for the deal. This seems to make Trump’s re-election much easier depending of course upon the impact of any potential recession. I am sure that the President will take other measures to prevent or lessen the severity of any recession.

  5. Swedes are sheep being lead to the slaughter and future muggings. They should be advised them to look like predators, to carry weapons instead looking of looking weak, and ‘look poor”. No, I will not return my Swedish Mauser set up for 600 meters back to Sweden. Are you Swedish?(stupooid?)

    https://europe.infowars.com/swedes-advised-to-dress-poorly-to-deter-violent-muggers/

    Swedes are also being lead to the slaughter, into Max Keiser’s Neo-fedualism or gulag, with a chip in the hand. Stolen from Survivalblog.com is an article that some Swedes are now receiving a chip in the hand to aid in financial transactions. How Swede it is… helt dumbt!

    https://nypost.com/2019/07/14/swedish-people-are-getting-chip-implants-to-replace-cash-credit-cards/

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